How often do we stop to consider the lifecycle of the products we purchase?  We may think about acquiring an object and its usefulness in our lives, but rarely do we stop to reflect upon the item’s “life” before it arrives in our possession, and where it goes when its time with us ends. Can new levels of reuse be employed, thus limiting the impact of our current resource usage upon future generations? The role of designers as the creative spark in transforming production may be the key to unlocking new levels of product reuse and recycling.

Investigating the Role of Design in the Circular Economy from the Royal Society of the Arts Action and Research Centre [1], explores The Great Recovery Project, an initiative launched in 2012 to build a cross-disciplinary community that is equipped to support the development of an economy based on resource-efficient principles.  In the circular economy, products are developed in a cyclical manner, with consideration of the past, present, and future of the fabricated object.  Through tear down and build up workshops, exposures to waste management and recycling facilities, and increased dialogue and networking across disciplines, The Great Recovery Project seeks to move production, use, and disposal to a new cyclical structure, embracing the circular economy to lessen our footprint upon the planet.

How can we move to circular thinking with products built upon simple, straightforward means of appropriate second-lives, deconstruction, or discarding?  Presently, the Waste & Resources Action Programme (WRAP) estimates that around 540m tonnes of products and materials enter the UK economy each year but only 117m tonnes of this gets recycled. If an equivalent of a mere one-fifth of that which enters the UK economy is recycled, can this hurdle be overcome?  Without thinking more holistically about how elements and components can be reused, we face an uncertain future in which valuable waste may be lost to us where it could otherwise be reused.

Are we creating an insurmountable amount of waste? 90 percent of the raw materials which go into making durable products become waste even before the product leaves the factory, and about 80 percent of what is made is discarded within the first 6 months of life. When about 80 percent of a product’s environmental impact is ‘locked in’ at the concept design state, can we shift to thinking about design as a starting point for thinking circularly?  Designing products from a circular perspective empowers all levels, from early raw states to post-life break down for reuse.  Limiting the product’s impact in the early phases will ultimately save our resources in the long term.

If we stop to consider the life-cycle of a product from early design through to disposal, we can reduce our resource footprint, lessening our impact upon the planet. It is likely that we may need to do so in the decades to come, and that could become the enduring legacy that we pass on to our children.

Kate Burgess-Mac Intosh
© The European Futures Observatory 2013

References:

[1] The full report can be accessed through the following link, along with further information about the RSA Great Recovery Project:  http://www.thersa.org/action-research-centre/enterprise-and-design/design/the-great-recovery2

When futurists ply their wares they usually make a lot of assumptions about the future. This is very much the case for those futurists who undertake single point forecasting of future events. The concept of the Singularity - a point in time where accelerating change is occurring so fast that we are unable to keep up with events - is of the single point forecast variety. At some single point in the future, it is argued, it will happen.

Once we start to unbundle some of the assumptions n that position, we come across some interesting and surprising futures that normally don't enter into the discussion about the Singularity. For example, there is often an assumption that we will continue to enjoy an abundance of cheap and readily available electricity. Much of the argument about accelerating change assumes this as a base assumption.

Some time ago, we wrote about how that assumption could be called into question, and pointed to the potential of an energy gap in the UK in this decade [1]. This piece, from 2008, talked about the lights going out and the vulnerability of our information networks. We put together potential brown outs with the operation of the Internet, and found that we had a problem looming in this decade. It now appears that the problem is closer than ever [2]. According to Ofgem, we are on the brink of an energy crisis.

Of course, those organisations that exercise a degree of foresight will not have the problems suggested by Ofgem. They will have an array of back-up generators. They will probably be able to tap into the electricity generation of renewable sources - particularly solar and wind. They will have a contingency plan for when the lights go out and the Internet goes down. They will also be part of a miniscule number of organisations that have exercised basic foresight. The truth is that this development will engulf many organisations, if it were to occur, as so few are ready for this possibility.

One of the consequences of the lights going out is that the pace of accelerating change will slow. Indeed, it may slow the the point where we have decelerating change. If that were to occur, then the single point estimate of when the Singularity will occur will have to be put back. In that respect, the Singularity will be postponed. This could have the beneficial effect of allowing our social infrastructure, such as the legal system or business models, to keep pace with technological changes.

The Singularity won't, however, be cancelled. The prospect of intense energy shortages is likely to stimulate all sorts of new technologies around the issue of energy storage and conservation. It will create a problem that human ingenuity will want to solve. This process has occurred since the onset of the Industrial Revolution, and there is no reason to suggest that it will not continue into the future [3].


Stephen Aguilar-Millan
© The European Futures Observatory 2013

References:

[1] http://eufo.blogspot.co.uk/2008/06/when-lights-went-out.html

[2] http://www.telegraph.co.uk/finance/newsbysector/energy/9879442/Britain-on-the-brink-of-energy-crisis-warns-regulator.html?fb

[3] http://www.eufo.org/uploads/1/4/4/4/14444650/surfing_the_sixth_wave.pdf

One of the main objections to modern capitalism that is levied by the Occupiers is that it generates a situation that is manifestly unfair. The unfairness of the situation are the large disparities in wealth that have come about during the years of the 'Washington Consensus' (free market economics combined with a minimalist approach to state intervention and regulation). The Washington Consensus has given rise to an unparalleled increase in prosperity across the planet, but one has to ask whether this is  sustainable in the longer term. If the increasing disparities in income and wealth were to lead to increasing levels of social unrest, then the gains to prosperity that have been achieved in recent decades could well be called into question.

An important point raised in Will Hutton's book 'Them and Us' [1] is that for a society to prosper, there needs to be a broad consensus within that society that the distribution of income has been reached through a fair process. Indeed, we have previously argued that the perceived unfairness of our current social arrangements is the result of many of our institutions that are no longer 'fit for purpose' [2]. It has always been argued that, for a harmonious society to occur, an appropriate balance has to be reached between economic efficiency - which normally involves the operation of unfettered markets - and social justice - which normally involves some form of re-distribution  of wealth and income. This point has recently been made by Jerry Muller [3], and is at the heart of the demands of the Occupy movement.

There is, however, more to the issue of inequality than fairness alone. Economists have a concept called the marginal propensity to consume. This is a simple device, which answers the question: if you were given an extra £1, how much of that would you spend? One of the answers that has been consistent over decades is that poorer people in the income distribution will spend more of that £1 than richer people in the income distribution. They have a higher marginal propensity to consume. If we find ourselves in a recession that is typified by a lack of demand in the economy - as we do now - then one of the more effective ways in which to get the economy moving again would be to re-distribute to the lower end of the income scale rather than providing benefits at the higher end. Which seems close to what is asked by the Occupy movement.

The Occupy movement does not speak with a single voice, so it is difficult to characterise exactly what their proposals are. Indeed, I had an interesting afternoon at the Tent City University at Occupy London discussing economic futures, listening to why I was wrong. However, there are those who argue that the present distribution of income is wrong and inefficient. In an interesting Special Report, The Economist reviews various aspects of what reform might look like and argues that institutional reform is more likely to generate more sustainable results than yet more tax, spend, and regulate [4]. This is an interesting idea and has some merit.

Does inequality matter? Yes it does. Inequality produces an feeling of unfairness within society which undermines the social cohesion that we all rely upon. It also prolongs a period of idleness in the economy, when productive resources - especially labour resources - remain under-utilised, which further erodes the social capital that has been built up. We live at a point in time where the root cause of this situation is structural, which means that the most effective remedies are likely to be structural in nature. We are likely to achieve more by attacking crony capitalism than by relying upon the traditional policies of income re-distribution, which is very close to what the Occupiers have been saying.


Stephen Aguilar-Millan
© The European Futures Observatory 2013

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References:

[1] http://www.guardian.co.uk/books/2010/sep/26/them-and-us-will-hutton

[2] http://www.eufo.org/uploads/1/4/4/4/14444650/the_new_enlightenment.pdf

[3] http://www.foreignaffairs.com/articles/138844/jerry-z-muller/capitalism-and-inequality

[4] http://www.economist.com/node/21564414

There is a wonderful moment in the folklore of economics when the Queen, on a visit to the LSE, asked why it was that so many eminent and distinguished scholars of economics had not foreseen the length and severity of the economic downturn that we continue to suffer. Of course, some had seen the crisis in advance, forewarned of it, and were ignored. Such is the fate of Cassandra! However, it is a point well made, and one that hit home.

What the Queen touched upon was a more fundamental question: is economics fit for purpose? Up to 2007, we would have said 'yes'. The free-market neo-classical economics had delivered decades of rising prosperity and improved living standards. It was only when that particular strain of economics was tested that it was found wanting. It was found that the fundamental principles of the free-market neo-classical economics had a significant flaw - the theory was too divorced from reality. It represented a fiction of human behaviour that was overly influenced by one narrow political stripe. Under pressure, the fiction evaporated.

One response to this was to argue that the theory was right, but that it had not been followed properly. This view doesn't have many supporters now. Another view was that the theory was wrong, and that a new economics was needed, one that gave as much prominence to social contribution as was formerly given to personal enrichment. This is a theme that the Occupy movement has taken up, where social justice is seen as just as important as rising prosperity. Added to that is the growing agenda of sustainability - a world in which there is little economic growth - which helps to form the shape of the new economics.

This indicates two things. First, a growing belief that the days of relentless economic growth are numbered. If we are to see slow, or no, growth, then the issue of the distribution of income - the social justice agenda - is likely to rise in importance. Second, whereas the free-market neo-classical economics had a very restricted role for government, collective social action takes a more prominent role in defining and delivering an outcome that is more socially just. To that extend, the Occupiers are right. And they need a new economics to help them deliver that outcome.


Stephen Aguilar-Millan
© The European Futures Observatory 2013

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Are we entering an Age of Scarcity? For a number of years, our stock answer to this question is that we are. This answer was formed, in part, by the view that Peak Oil - the point at which 50% of the oil resources of the planet were out of the ground - had been passed. A recent report by the International Energy Association suggests that this assumption could be mistaken. According to the IEA, the production of oil in the United States is growing at a pace that will make it the worlds largest oil producer by 2020, and which will leave the US self-sufficient in energy by 2035. The IEA report also suggests that American production of oil will outstrip that of the current oil producers, such as Saudi Arabia, by 2020. This forecast is shown in the graph, which originates from The Economist, using IEA data.

There is a bit more to the story than just the changing patterns of energy production. There is also an appreciation of the impact of water resources upon energy production. This is a point made in a piece in the Daily Telegraph, that modern energy production tends to be rather water intensive. It highlights that our future potential energy abundance could be curtailed by water shortages. A different approach was taken in the New York Times, which highlighted some of the assumptions made by the IEA about energy usage in the US. It would appear that the forecast relies heavily on the introduction and widespread use of energy saving technologies in the US, to place something of a cap upon the consumption of oil derived products.

Where does that leave the scarcity agenda? In one respect, we could take the view that the whole issue of Peak Oil has been something of an alarmist position, and that the worst aspects of Peak Oil were never going to happen. There is an element of truth in this view. The concept of Peak Oil, as used by futurists, served as something of a warning of an unpleasant future for which there was time to avoid. We could take the view that this is happening.

In many respects, this reinforces the scarcity agenda. One could argue that, in the face of an impending shortage of oil, the price mechanism has worked to ensure that technologies have been developed to secure a new supply of oil, and are currently working to improve a more efficient use of the oil which we do have. This was always going to be the path out of scarcity, in which case, we could say, the whole scarcity agenda has had an effect.

We are caught between the two positions. The development of new production methods for extracting oil are not cost free. They tend to have a large environmental footprint, the externalities of which are nowhere near being covered in the current market price of oil. It is almost a position where we can continue to drive our cars, but at the costs of the environment. There is also a case to say that we are moving a key scarcity from one area (oil) to another (water). In doing so, we are fudging the problem rather than solving it.

There is a case to say that we have seen the end of Peak Oil - for the moment - but that does not mean that we have grounds to rejoice. We have yet to see the full bill for this development.

Stephen Aguilar-Millan
© The European Futures Observatory 2012